Government think tank flags shortfall in rice tariff

Additional strain on budget

MANILA, Philippines — The persisting shortfall in rice tariff collection will cause additional strain on the government’s fiscal space as the revenue gap would be plugged by other sources, a congressional think tank said.

The Congressional Policy and Budget Research Department (CPBRD) flagged that rice tariff collection has remained below the P30-billion target to sustainably support the Rice Competitiveness Enhancement Fund (RCEF).

Since 2019, the government has been earmarking collected tariffs from imported rice for the development and modernization of the local rice industry through the RCEF.

The annual appropriated RCEF budget has been increased to P30 billion from P10 billion following the enactment of Republic Act 12078.  Under RA 12078, the P30 billion is a guaranteed budget allocation regardless if rice tariff collection falls short of the amount.

The law stipulated that the shortfall in collection would be sourced from the existing budget of the Department of Agriculture (DA).

Tariff collections, the source of RCEF, declined to P13.71 billion in 2025, substantially below the P30 billion RCEF allocation.

“The decline raises concerns about the adequacy of tariff collections to support the expanded RCEF funding level,” CPBRD, the socioeconomic and fiscal think tank of the House of Representatives said in a recent report.

“Should tariff collections remain below the mandated RCEF allocation, the shortfall may need to be covered by other sources of government revenues, placing additional pressure on the national budget and increasing reliance on taxpayer-funded resources,” CPBRD added.

The CPBRD noted that rice tariff collection last year fell to P13.71 billion from P30.01 billion and P34.18 billion in 2023 and 2024, respectively.

The decline in rice tariff collection has been attributed to the record-low tariff rate on imports at 15 percent, coupled with the implementation of an import ban last year.

The Marcos administration slashed rice tariffs to allow the entry of cheaper foreign rice stocks to tame price increases of the staple.

Meanwhile, rice importation was suspended late last year to protect rice farmers’ income that has suffered from falling palay prices due to higher import volume in the previous years.

This is not the first time the CPBRD raised concerns regarding the impact of the dwindling rice tariff collection.

Last year, the CPBRD pointed out that sourcing the shortfall in rice tariff collection from the DA budget would result in RCEF “competing” with the allocation for the regular programs and projects of the department.

This often comes at the expense of other important agricultural sub-sectors such as high-value crops, poultry and livestock, the CPBRD noted.

The P30-billion RCEF is used to support farm mechanization, high-quality seed production, cash assistance, rice farmer training and extension, among others.

Meanwhile, the country’s rice tariff collection from January to August reached P14.28 billion, about 19 percent higher than the nearly P12 billion collected in the same period last year, based on preliminary Bureau of Customs data.

The increase in rice tariffs is supported by higher import volume that grew by a quarter on an annual basis plus a weaker exchange rate amid persisting low tariff rate and softer global rice prices.

Despite the uptick in rice tariff collection, industry sources told The STAR that it would be impossible for rice tariff collection this year to hit P30 billion.